Bogomil Manchev, Chairman of the Bulgarian Atomic Forum: Changing the turbines for Belene NPP will raise the cost of the project further

- Mr. Manchev, do you think it is possible that the Russian side will demand to be paid penalties of some €980 mln for the construction of the Belene NPP in two months, as posted by the Russian newspaper Kommersant?
- I cannot tell for sure if this is the amount of penalties. In the present situation of the project, the following should be taken into consideration – if no contract is signed by July 1, the Russian side (no matter whether it wants to or not), should write a letter to warn the National Electricity Company (NEK) that a formal call for a lawsuit at a court of arbitration will follow. It is a matter of negotiations whether Russia’s Atomstroyexport will agree to a new extension for the construction of the nuclear plant. This should not be discussed now because the two parties may reach an agreement and, ultimately, the next annex may set definitive dates for Belene’s construction and price.

But there is no such thing in the current agreement, notwithstanding the scandal which broke out. It says that the two sides are willing to endorse the EPC (Engineering, Procurement and Construction) contract by June 1 and hold the negotiations in good faith. It is not very fair now for the other side to say that Bulgaria has made some mistakes during the negotiation process or that it has been protracted due to the selection of the British HSBC Bank as an adviser. This should not affect the talks. Because our country can now decide that it needs another advisor and this will delay the negotiations again.

- Do you believe HSBC will be able to do the job by July 1? Economy Minister Traicho Traikov seems to have doubts about it.
- He is right to have doubts. The time is very short and the bank’s experts should review a lot of things. They must make express specifications but not for the project’s framework. But they should at least give reasons as to whether the Belene NPP project should continue or not. I cannot tell you if they will manage to do their job in time, it depends on the experts to be hired and on whether they will work without interruption as some organisations do.

- What remains to be negotiated with the Russian side for Belene after the technical part of the project has been approved? Is it only the price?
- Yes, the price is the only thing that remains to be agreed.

- In the present situation, can we see the first concrete on Belene’s site this year?
- No we cannot. We missed this golden chance. In the best case scenario, if we get the job done by mid-2011 and have time to prepare the site, concrete can be poured in March 2012.

- This means we are late by at least six months.
- This is a technological problem and everybody knew it. However, it cannot influence the decision to be made by the Government.

- Does this mean that the power plant can be ready in 2018?
- Yes, if we assume April 1, 2012 as the date for the beginning of construction. The temperature outside is very important for the pouring of concrete. And if we assume that everything is normal as of that date, the construction of the first units will take 59 months and another 12 will be needed for the second unit.

- What is your expert opinion of the Bulgarian Government’s idea to change the current turbines with French ones in order to increase the capacity of Belene NPP’s two units?
- This is just an option, in my opinion. The French turbine ‘Arabella’ has been long since considered as a possible equipment for the Belene NPP. It is produced by the company Alstom and is a very good one, indeed. But changing the turbine means that the entire equipment which has already been designed by Siemens should be changed as well and made anew. The projected turbine comes with additional equipment.

- How much would such an undertaking cost and how much is the turbine itself?
- The French turbine is nearly two times more expensive than the one used at present. It could cost us about €60 mln. But this is the price of the equipment alone. God knows how much it would cost to redesign the nuclear plant. If the ‘Arabella’ turbine is chosen, the electric generator should be changed, too. And if it is changed, everything will need to be changed as well – protection systems, locks, auxiliary and cooling systems. All this will cost extra money for redesigning and re-equipment of the plant. It is important to make an evaluation whether these investments will be returned as additional revenues from the higher amount of generated electricity.

Such a change will also mean changing the technical task of the Russian side and it will have to say if there is no problem in generating a sufficient quantity of steam. This means that the Russian company will demand additional money, outside the EPC contract, which is currently around €4 bn.

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